Railway Reform: Toolkit for Improving Rail Sector Performance - ppiaf

Railway Reform: Toolkit for Improving Rail Sector Performance
5. Creating the Industry Structure
ernments lack financial and administrative capacity 60 . In principle, the national
public company might compete with private train operators for the
concession, which could include local rail infrastructure. Box 5.5 presumes a
model of a private train operating a concession under a network access contract
on a joint-user network administered by the national railway company.
This type of train operating concession should be re-bid periodically to ensure
competition.
• Option 4: government adopts a policy of separating rail freight services into
an independent commercial public company. Freight services are split from
passenger service, staff and freight train operating assets are transferred into
a new incorporated structure with separate accounts, board of directors, and
shareholders—independent of other parts of railway business. The company
would operate under a network access contract with the main public passenger
company. This separation recognizes differences between freight and passenger
transport customers, service needs, and economic drivers, not to mention
different political profiles that typically result in higher resource allocations
for passenger services when both freight and passenger transport are
under the same corporation. 61
60 Examples of different approaches include, for example, passenger rail concessions in
Buenos Aires offered in concession by the national government (including the Metro) and
the Rio de Janeiro metro and suburban rail services offered by the State government.
61 Option 4 presumes that the archetypal railway has a substantial passenger role, that
the freight company should be separated, and that the network and passenger services
remain corporately connected. However, if rail-freight services predominate, and passenger
services are marginal, horizontal separation to constitute passenger services as a
separate train operating company would leave a vertically integrated freight company
as the core public railway, offering network access under contract to the passenger
company.
The World Bank Page 80